OHSU health economist sees mixed picture in health reforms so far

John McConnell, a health economist at Oregon Health & Science University, is keeping a close eye on health reform in Oregon.

As director of OHSU’s Center for Health Systems Effectiveness, he is closely tracking the performance of Oregon’s 16 Coordinated Care Organizations and specifically, how they achieve their cost savings.

“It’s the biggest attempt to hold a health care system accountable for spending in the U.S.,” said McConnell, who is also an adviser to the state on reimbursement reform. “It’s never been done before.”

The CCOs, which serve Oregon’s Medicaid population, must reduce spending growth by 2 percentage points in exchange for the $1.9 billion Oregon got from the federal government. All eyes are on Oregon to see if it can achieve that goal without compromising the quality of care.

I asked McConnell a few questions about how the CCO experiment and other health reforms are going so far.

Portland Business Journal: You’re doing an in-depth study on the CCOs, but in the meantime, how would you assess their progress?

McConnell: There’s a lot of variation. Generally, their policies are right and they’re very well thought out. They’re going in the right direction. The devil’s in implementing the details. Some are moving in the right direction, others are slower.

PBJ: Does anything concern you?

McConnell: I worry a little that each one is doing its own thing from the ground up and they could benefit from centralizing a bit.

PBJ: The Affordable Care Act’s medical device tax was in the spotlight during the government shutdown. What do you think of the tax?

McConnell: If you look at the big drivers of why health care expenses are growing so rapidly, a lot is new technologies – devices, drugs and procedures. You have to be careful. If you tax innovations, you may miss out on good innovations that improve the quality of life. The problem is some (innovations) benefit a small population.

PBJ: What do you think of the rollout of the exchanges and all the problems? Is that a bad sign?

McConnell: It’s a bigger project. It’s a rough start. It’s not clear if it was funded well enough from the beginning to do the implementation. But it looks like some things went wrong. Hopefully, you can turn it around. A lot of it is how much can you do on the fly? There’s a lot of back end-front end integration that has to happen. They better figure it out quickly or it’s going to be a problem.

PBJ: And Oregon?

McConnell: It looks like the Oregon exchange is doing a little better. That team is really strong. Nobody expected it to be perfect from day one. I don’t think they were caught by surprise. I’m still optimistic.